One of the challenges I’ve heard multiple times from entrepreneurs is around inconsistent lead flow from marketing. Marketing is running the standard playbook — SEO, PPC, webinars, events, email drips, social — and it’s working with demonstrable value. Only, it’s inconsistent. One month is great and the next month is weak, yet it’s hard to discern why.
What’s a high performing startup to do about inconsistent lead flow from marketing? Here are a few thoughts:
- Ask the five whys. Drill down and look for patterns or trends that aren’t visible from the surface. Look for seasonality, major events like an industry tradeshow, or other major influences.
- Track everything. Implement Pardot and a marketing attribution engine. Track everything that can be tracked.
- Run an account-based marketing process. Identify best-fit targets. Build a playbook. Execute the process. Iterate.
Inconsistent lead flow is normal. The key is continuous improvement and refinement.
What else? What are some more thoughts on inconsistent lead flow from marketing?
Predictable Revenue laid the ground work for sales development and the rise of sales engagement software. The author, Aaron Ross, outlined a more modern, predictable function of appointment setters on the sales team, as separate from the closing team. In the book, he outlines four types of functions on the sales team.
Here are the four types of sales reps in startups:
- Market Response Rep – Qualifies and nurtures inbound leads that are handed off to an account executive once engaged in the sales cycle (one rep can handle approximately 400 inbound leads per month)
- Outbound Sales Development Rep – Cold calls and emails potential prospects and nurtures them until they are ready for an account executive (one rep should generate 10-20 qualified leads per month)
- Account Manager – Manages the relationship with existing customers and continually looks for ways to add more value
- Account Executive / Sales Rep – Carries a quota and is responsible for taking leads engaged in the buying process through to close and hand-off
Early in the startup lifecycle, it’s common to have “full stack” sales reps that do both the appointment setting and deal closing. Then, as the startup grows, more specialization emerges. Look for these four types of sales reps.
What else? What are some more thoughts on the four types of sales reps?
At Pardot, we’d work hard to get marketers to a web demo, through cold calling and typical B2B marketing campaigns, as we knew there was one “wow” or “magic moment” that really made the value of the product apparent. David Skok calls it the “wow” in Creating a Wow Moment.
Our Pardot wow: showing a marketer their own activity history in Pardot via a screen share. When marketers saw how all their digital fingerprints (clicks, opens, page views, etc.) were captured, and made actionable to both sales and marketing, they immediately wanted that functionality for their own team.
Here are a few questions to ask:
- What’s the “wow” in your product?
- How hard is it to show the “wow” to a prospect?
- Where is “wow” currently shown in the sales process?
- How can the “wow” be delivered sooner?
Entrepreneurs would do well to think through the feature in their product that is most powerful and exciting to prospects — the “wow” — and work to deliver that to prospects as quickly as possible.
What else? What are some more thoughts on getting to “wow” in the sales process?
Continuing with yesterday’s post on Territories vs Wide Open for Sales Teams, one of the points mentioned was that with territories, as the team scales, the assigned geography for each sales rep shrinks (more reps equals more sub dividing of territories). As expected, many challenges arise as the sales team scales. Here are a few to consider:
- Sales Reps to Management – The top sales reps often don’t make the best sales managers (different skill set and personality traits). As the team grows, it’s important to set expectations around the path to management and build management training programs.
- Downward Lead Volume Per Rep – The size of the sales team often grows faster than the volume of qualified leads such that the number of leads per rep goes down over time.
- Hiring Standards – It’s hard to find great sales people. As pressure is applied for hitting an overall team quota, there’s a tendency to lower hiring standards to get more people in the door. Don’t do it.
- Undoing Special Arrangements – Special sales rep arrangements like owning certain reseller relationships or getting a slightly different commission for certain deals become problematic as the team grows and more specialized functions are implemented (like a channel program).
- Adding Process – Some reps that thrive during the free-for-all early startup stage don’t make it as the organization hits the growth stage and adds more process. It’s not that one stage is better or worse. Rather, it’s important to connect the right personalities with the right stage of the company.
Scaling a sales team is hard, especially with the pressure from different stakeholders like investors. Know that there are many challenges scaling a sales team and these are just a few of them.
What else? What are some more challenges scaling a sales team?
At Pardot, we built the sales team to almost 30 people before the exit and never had territories (everything was inside sales). Our model was wide open with simple round robin lead assignment based on two different queues (one based on leads from the test drive form and one based on leads from all other forms). When I talk to entrepreneurs about their sales strategy, territories are commonplace. Naturally, we had internal debates about the pros and cons of territories vs wide open.
Here are a few thoughts on territories vs wide open:
- With wide open, sales reps get an equal number of qualified leads as company lead volume ebbs and flows
- With territories, sales reps get a reduced geography as the sales team grows, potentially resulting in morale issues
- With wide open, there’s a constant tension around the rules of engagement for stale leads (we made it so that if a lead hadn’t been engaged in six weeks, it was fair game)
- With territories, sales reps that are primarily inside have a better opportunity to meet with multiple prospects on the occasional trip to their territory as well as attend regional events
The growth of inside sales is causing entrepreneurs to rethink the traditional territory approach and look for ways to make sales more efficient. Entrepreneurs would do well to evaluate both the territories approach as well as the wide open approach.
What else? What are some more thoughts on territories vs wide open for sales teams?
Continuing with our recent sales theme, our video of the week is from Stanford titled Make Body Language Your Superpower. Enjoy!
From YouTube: Making Body Language Your Superpower – an instructional video on using body language effectively. Presented by Stanford graduate students Matt Levy, Colin Bailie, Jeong Joon Ha, and Jennifer Rosenfeld. Created as an exemplary final project in Lecturer JD Schramm’s Strategic Communication course in March 2014. Body language – both the speaker’s and the audience’s – is a powerful form of communication that is difficult to master, especially if the speaker is nervous. This video will teach you how to use your body language effectively, even if you are nervous. This video will also show you how to read the audience’s body language and what you should do when they look bored or disconnected from the presentation. Use these tools to enhance your nonverbal communication abilities and better connect with your audiences.
After talking to a number of entrepreneurs that are getting value out of their sales development rep (SDR) team (especially when using SalesLoft Cadence), a common question comes up: what are some SDR benchmarks? Entrepreneurs want to know where they are in relation to average, and areas to improve.
Here are a few questions to benchmark the sales development reps:
- What’s the average number of successes (demos, appointments, meetings, etc.) per rep per month?
- What’s the ratio of demos/appointments scheduled to completed (e.g. how many people don’t show up)?
- What’s the average number of calls per day?
- What’s the average ratio of calls to connects (calls that result in talking to someone)?
- What’s the average ratio of positive conversations to calls?
- What’s the average ratio of voicemails left to calls?
- What’s the average number of emails per day?
- What’s the average ratio of email opens to emails sent?
- What’s the average ratio of email clicks to emails sent?
- What’s the average ratio of email replies to emails sent?
While I don’t have the benchmarks (yet), I’m sure we’ll be seeing them soon. Look for more data to emerge as the sales engagement industry grows.
What else? What are some more questions to ask around benchmarking sales development reps?
Recently I was meeting with an entrepreneur and he was telling me about the weekly sales pipeline review he does with their head of sales where they talk about every opportunity that’s expected to close in the next 30 days. This got me thinking about the different meeting rhythms throughout a sales organization.
Here are some of the common sales meetings:
- Daily stand up or check-in meeting where everyone goes around and answers the questions “what did you accomplish yesterday?”, “what are you going to do today?”, and “are there any roadblocks?”
- Weekly 1-on-1s where the sales manager meets individually with their direct reports and provides coaching and feedback (WideAngle is recommended for managing this process)
- Weekly pipeline review with the sales managers and the executive that’s responsible for sales (often the CEO)
- Weekly product training session where the sales team is trained on a different aspect of the product, both new and old features
- Weekly sales meeting where the team huddles for a few minutes and talks about what is, and isn’t, working
- Quarterly board meeting where the sales leader provides an update for the board
- Annual sales kick-off meeting to talk about the new year and new opportunities
These are some of the more common recurring sales meetings found in a scaling startup. The goal is to find the right balance between too many meetings and too few.
What else? What are some other common recurring sales meetings?
Continuing with yesterday’s post on Mining the Sales Opportunity History for Insights, there’s another more common sales leader and executive function: regularly reviewing the sales pipeline. Early in the startup lifecycle, the sales pipeline is often more sporadic as the sales stages and process are being developed. Then, as the sales process matures and there’s more operating history, the pipeline becomes an importance source of forecasting.
Here are a few questions to ask when analyzing the sales opportunity pipeline:
- What’s our coverage ratio goal? What’s our current coverage ratio? Coverage ratio is the sales pipeline relative to quota (typically 3:1 is a starting point).
- What opportunities are in our normal range for average amount (value), average sales cycle (days from opportunity creation to close), and any other key data points?
- How well does each opportunity meet the MEDDICC qualification standard?
- How has each opportunity moved forward or backward in the time period since the last review?
- What is the next step with the opportunity?
- Anything else we need to know about the opportunity?
Reviewing the sales opportunity pipeline is a regular part of growing a startup. Build a process and include a consistent set of questions.
What else? What are some more questions to ask when analyzing the sales opportunity pipeline?